European Nickel announces Rusina merger

Date: Tuesday 02 Feb 2010

European Nickel has announced plans to merge with fellow AIM-quoted nickel miner Rusina Mining.

European Nickel is offering four of its shares for every five Rusina shares. This deal values Rusina at £18.1m – based on the weighted average European Nickel share price over the past 10 days of 7.45p.

Rusina’s board is recommending the bid which will be completed via a scheme of arrangement. European Nickel already owns 2.9% of Rusina, whose shareholders will end up with 27.3% of the enlarged company.

Rusina is also listed on the ASX. European Nickel says that it will seek an Australian listing via CHESS Depositary Interests.

European Nickel has raised £12.1m via a placing at 7p a share. European Nickel’s main project is in Turkey. The Çaldağ project will be the world's first commercial scale nickel laterite heap leach operation.

Rusina has nickel interests in the Philippines. It currently owns 72% of the Acoje project. European Nickel has a 20% interest and had the right to earn up to 40%. The project will have a simpler structure after the merger. A Definitive Feasibility Study is due to be completed in 2011.

The combined group will have a JORC resource base of 1.35m tonnes of contained nickel and will target production of 50,000 tonnes of nickel a year in the medium-term.

This is a merger and not a European Nickel takeover. Rusina’s chief executive Robert Gregory will become managing director of the enlarged group. Rusina’s finance director will take up that role at European Nickel.

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